In addition to the usual banks and financial institutions in your students’ communities, there are some other financing options available. These include Bureau of Indian Affairs (BIA)/tribal credit loans, Native and non-Native Community Development Financial Institutions (CDFIs), and Individual Development Accounts (IDAs).

BIA loans

Depending on the location and programs of the tribe and the tribal government’s relationship with the BIA, there may be a number of financing options available through either the BIA credit office (if that service has stayed with the local or area BIA office), the tribal credit office (if this office exists and has perhaps taken the option to run its own BIA guarantee program through the tribe), or a combination of the two with the involvement of banks, Native CDFIs, credit unions, or other institutions. Every location is a little bit different from the other and your students will need to know the scenario they will be working with in their Native community.

The BIA loan guarantee in any form can be a way for tribal members to access financing, but many of the same lending requirements and policies will be in place with these programs, so all of the lessons on credit, budgeting and planning still apply. Business loan applications will still require the necessary paperwork, documentation, credit checks, and business plans in most areas.

CDFIs

Native Community Development Financial Institutions (NCDFIs) provide capital for Native small businesses, homeownership, community development projects, and consumer banking. There may be one or more Native CDFIs in a tribal area or there may be partnerships with CDFIs, banks, credit unions, and the tribe in some cases. The NCDFIs offer training and technical assistance to prospective borrowers, and many of the topics discussed in this site are the kinds of functions that these organizations serve in Native communities. These institutions are designed to teach and lend, so they have the well-being and self-sufficiency of the individual and the community at the core of their mission.

IDAs

The Corporation For Enterprise Development originally created the IDA program to help low-income families build the financial assets they need to achieve their dreams.

When a person sets up an IDA, he or she designates which of four purposes the money will be used for. The options are:

• purchase a home
• start a business
• enroll for education or training
• save for retirement

Some IDA programs may offer different savings options, depending on the needs of the community and the sources of funding.

An IDA works as a matched savings account, so for every dollar your students place in an IDA, a sponsor matches the deposit with a pre-set amount. The amount of the match depends on the program, but it adds up quickly.

Typically managed by community organizations, IDAs are held at local financial institutions such as banks and credit unions. All participants receive economic literacy training on such topics as cleaning up credit, setting up a budget, plans for saving, and other basics of money management.

When it’s time to put the funds to use, the IDA administrator writes a check to the third-party recipient, whether it’s a title company, college, or business equipment vendor, and your student is on the way to achieving that goal.

There are a growing number of Native IDA programs around the country and the Native Assets Research Center at First Nations has been working extensively on the growth of these institutions. Recent Native IDA convenings and research papers attest to the strength of these organizations in Native communities. A recently created Native IDA program at the Wind River Development Fund on the Wind River Reservation in Wyoming was the first IDA program in the entire state. Documentation on this activity can be found in the Document Library and Other Resources sections of this site.

For more information on IDAs, contact Corporation For Enterprise Development or Native Assets Research Center at First Nations